New York State Supreme Court Upholds MBIA’s Transformation

ARMONK, N.Y.–(BUSINESS WIRE)– MBIA Inc. (NYS: MBI) (the Company) today announced that the New York State Supreme Court has upheld the New York State Insurance Department‘s (now the Department of Financial Services) decision to approve MBIA’s Transformation in February of 2009, which came after the Department’s thorough and careful analysis. Initially, a group of 18 banks challenged the approval in an Article 78 proceeding, although by the commencement of hearings before the Court, just two banks remained. In its 59-page, thorough and well-reasoned decision, the Court rejected each of the banks’ arguments that the Department’s approval of Transformation was either arbitrary and capricious, or contrary to law.

“After almost four years of court filings, discovery and hearings, we are pleased that the New York State Supreme Court has affirmed what was obvious all along – that the New York State Insurance Department‘s approval of our Transformation was proper in all respects,” said Jay Brown, MBIA CEO. “With the Court’s ruling now in hand, we look forward to resolving the remainder of our litigation so that we can support the financing needs of towns and cities across America by re-establishing National Public Finance Guarantee Corporation, our U.S. muni-only insurer, as a leader in the U.S. public finance insurance market.”

Forward-Looking Statements

The information contained in this press release should be read in conjunction with our filings made with the Securities and Exchange Commission. This release includes statements that are not historical or current facts and are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “believe,” “anticipate,” “project,” “plan,” “expect,” “intend,” “will likely result,” “looking forward” or “will continue,” and similar expressions identify forward-looking statements. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected, including, among other risks and uncertainties, whether the Company will realize, or will be delayed in realizing, insurance loss recoveries expected in disputes with sellers/servicers of RMBS transactions at the levels recorded in its financial statements, the possibility that the Company will experience severe losses or liquidity needs due to increased deterioration in its insurance portfolios and in particular, due to the performance of CDOs including multi-sector, CMBS and CRE CDOs and RMBS, the …read more
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